Modus Hotels Buys Baltimore’s Brookshire Suites

By Adrian Maties, Associate Editor

Modus Hotels, a full service hotel development and management company from Washington, D.C., has purchased Baltimore’s Brookshire Suites last week. It is Modus’ first hotel in downtown Baltimore and its third hotel acquisition of 2012.

The Brookshire Suites is located immediately adjacent to Baltimore’s famous Inner Harbor. It offers its customers 97 spacious suites, averaging 500 square feet. Each suite contains a sleeping area and a separate living room furnished with a sofa, oversized desk, free WiFi, and a mini-refrigerator. Other amenities include a meeting room facing the harbor and a state-of-the-art fitness facility. The hotel is also pet friendly.

Modus’ newest acquisition is located close to such attractions as the National Aquarium, the Baltimore Convention Center, Baltimore Orioles’ Stadium, Camden Yards and the Baltimore Ravens M&T Bank Stadium. Although the fourth quarter is typically slow for hotels in the region, with the New York City and the Washington, D.C. metro as perhaps the only exceptions, occupancy in the northeastern United States is on the rise. The presidential inaugural in January may also help strengthen the market.

“With its ideal location along Baltimore’s Inner Harbor and its distinctive identity, the Brookshire Suites is a perfect fit in our expanding portfolio of Modus Hotels,” noted Aaron Katz, president and CEO of Modus Hotels.

Modus plans to invest several million dollars to fully renovate and re-concept the property and incorporate it into the Modus Hotels Collection, a portfolio of 12 hotels. The renovation project will start in January 2013, in phases so as to minimize guest disruption. It includes a new lobby, new guest suites and a new exterior. Modus expects to complete it in the fourth quarter of 2013.

“Following the completion of the renovation and the implementation of our proprietary marketing and management systems, we believe the hotel will be well positioned as an affordable, lifestyle hotel experience, something not offered by the existing hotels in the Baltimore market,” Aaron Katz said.

Photo credits: www.brookshiresuites.com

Charts courtesy of Marcus & Millichap.

Grand Opening for Groveton Green, the First and Only LEED Gold Apartment Community in Owings Mills

By Adrian Maties, Associate Editor

Groveton Green Apartments held a grand opening ceremony on November 15 in Owings Mills. Baltimore County Executive Kevin Kamenetz, Councilwoman Vicki Almond, Councilman Ken Oliver and Reisterstown-Owings Mills-Glyndon Chamber of Commerce Executive Director Brian Ditto were among those present at the ribbon cutting ceremony.

The $35 million project was developed by the Fore Property Company, a full service, national apartment developer, manager and owner with over 30 years of experience in the multifamily industry. Located at 9401 Groveton Circle, the community includes 226 luxury one-, two- and three-bedroom homes on 16 acres. Apartments feature hardwood style or stained concrete floors, walk-in closets, stainless steel appliances, tile bathroom floors, upgraded stone kitchen countertops, vaulted ceilings and more.

Residents will enjoy an 8,600-square-foot, three-story clubhouse accessible 24/7. It features a state-of-the-art fitness club, yoga studio, billiards, shuffleboard, a poker room, business center, conference room, multiple lounges and a dog wash. Additional outdoor amenities include a resort style pool, the Zen Garden, multiple fire pits, barbecue areas, covered bike parking, and the “Lucky Dog Park for your best friend.” Groveton Green is also ideally located in the heart of Owings Mills. It is close to grocery stores, shopping, dining and entertainment options as well as many employment centers.

Fore Property built the luxury apartment community to LEED Gold standards and is now awaiting certification. Residents will save energy with the help of energy efficient windows, appliances and lights, high efficiency HVAC units and enhanced insulation. Groveton Green is the first and only LEED Gold Designed apartment development in the Owings Mills area.

Fore Property Vice President Jim Sullivan said in September that the company “wanted Groveton Green to stand out for renters and Baltimore County from local existing apartment projects by providing the perfect combination of a high-end lifestyle with environmental sensibility. Residents get the benefit of reduced energy and water costs, a lower carbon and pollution footprint, and healthier living from cleaner air without having to lift a finger.”

Photo credits: www.grovetongreenapts.com/

PMC Acquires 301 North Charles Street for Apartment Conversion

By Adrian Maties, Associate Editor

PMC Property Group Inc. has closed on the acquisition of 301 North Charles Street. Kirby Fowler, President of the Downtown Partnership of Baltimore, announced the acquisition via Twitter. The building will be converted to apartments.

301 North Charles Street is a 92,500-square-foot office building at the northeast corner of Saratoga Avenue. It was constructed in 1930 and served for a long time as the headquarters of the Baltimore Life Insurance Company. The high-rise has 11 floors above ground and one below.

PMC acquired the building from USP Management LLC, a Falls Church, Va. company. The price of the transaction has not yet been disclosed. USP Management purchased 301 North Charles Street in 2006 for $6.89 million. The Maryland Department of Assessments and Taxation values the property at about $6.5 million.

In September, the Baltimore Business Journal reported that PMC plans to invest $15 million to redevelop 301 North Charles Street and convert it into an apartment asset with 92 units. The Philadelphia-based company’s plans call for apartments ranging between 700 square feet for one-bedroom units and 950 square feet for two-bedrooms, as well as about 5,000 square feet of retail space on the first floor. About 80 percent of the apartments will be one-bedroom units.

PMC has completed several projects in Baltimore City, and it is still involved in many projects in Baltimore’s Mount Vernon neighborhood. Known as a company that typically completes residential projects in less than a year, PMC is expected to deliver almost 200 apartments to the Mount Vernon area in the coming months.

Photo credits: Google Maps.

Two Class A Industrial Buildings Sold in Baltimore

By Adrian Maties, Associate Editor

Hillwood Investment Properties, a Perot company, has announced the purchase of two Class A industrial facilities in Baltimore. Hillwood made the acquisition in a joint venture with Brookfield Asset Management.

One of the properties is located at 451 Fletchwood Road, in Elkton, while the other is at 238 Belvidere Road in Perryville. Together the two properties total 1.8 million square feet. They have been built, managed and maintained to meet the highest institutional standards.

The properties are strategically located within Baltimore’s I-95 North corridor industrial submarket. The area consists of Harford and Cecil counties and benefits from a deep labor pool, growing population and the desirable quality of life of the Baltimore/Washington metro area. I-95, the primary highway serving the U.S. Northeast population center, is also easily accessible.

The Elkton facility was built in 2005, on 71 acres in the Broadlands Business Park. The facility in Perryville was also built on 71 acres, in 2003. It has 1,004,000 square feet of space. The buildings feature 28- to 30-ft. clear heights, ample dock high-loading doors, large truck courts with abundant trailer storage and future cross dock functionality. The facility in Perryville also includes active rail access that is served by CSX Railway.

Gary Frederick, Hillwood’s senior vice president and northeast market officer, said, “We are pleased to add these state-of-the-art properties to our expanding presence in the U.S. Northeast industrial sector.” Tom Fishman, Hillwood’s executive vice president of acquisitions, added that “Given the Class A nature of the buildings and high credit quality of the tenants, these properties are a great addition to the Hillwood-Brookfield portfolio.”

CBRE reports that the Baltimore area remains attractive for industrial users and investors due to its low unemployment, close proximity to Washington, D.C. and Philadelphia, and ease of access to the Port of Baltimore. As industrial leasing activity emproves, investors are looking to obtain assets. The overall vacancy rate in the Baltimore industrial market decreased slightly from 10.4% to 10.1%.

Charts courtesy of CBRE.

Baltimore Apartment Community Wins Top Honors at Three Award Ceremonies

By Adrian Maties, Associate Editor

The Arbors at Baltimore Crossroads in Baltimore recently won top honors at three award ceremonies. The luxury rental community was designed by KTGY Group, Inc., Architecture + Planning. It was developed by Somerset Construction Company and is managed by Bozzuto Management.

On October 25, at the Delta Associates 16th Annual Awards for Excellence in the Mid-Atlantic Apartment & Condominium Industries event, the Arbors at Baltimore Crossroads was recognized as the Best Baltimore Apartment Community 2012. The Maryland Multi-Housing Association (MMHA) presented it with a Gold Award in the category of Stellar Elevator Community: $1,200 and up at its 16th Annual Star Awards Gala, on October 10. And, on September 20, the community also received a Grand Award for the Best Design & Architecture, Multi-Family New Construction, 5 Stories and Under in the Great American Living Awards (GALA) program.

Rohit Anand AIA, NCARB, principal of KTGY, said that “In the awards programs, The Arbors at Baltimore Crossroads competed against many excellent projects so the fact that this community was selected as the recipient of these highly coveted awards is all the more meaningful.” He also thanked the judges and his partners at Somerset and Bozzuto.

This 365-unit eco-friendly apartment community is located on White Marsh Boulevard in the 1,000-acre Baltimore Crossroads mixed-use development. It is close to the White Marsh Town Center, numerous popular retailers, restaurants and entertainment centers,  and also ideally positioned in Baltimore’s growth corridor. Downtown Baltimore is just 12 miles away.

Tenants can choose from 23 floor plans available in single, two-, and three-bedroom formats, including homes with dens, lofts, and balconies. The apartment homes are built around a six-story parking garage which allows residents to park and live on the same level. It includes electric car-charging stations and solar panels on the roof.

Residents can enjoy such amenities as a two-story community room with a fitness center, multi-media center, billiards room, business center with conference area, library, child play areas, a pet spa, a swimming pool with sunning decks, multiple grills, garden, a car wash area and more. The community is targeting LEED Gold certification.

                       Photo credits: www.arborsbaltimore.com

Inner Baltimore’s Harborplace Sold to Ashkenazy Acquisition Corporation

By Adrian Maties, Associate Editor

Mayor Stephanie Rawlings-Blake announced on October 23 that the Baltimore waterfront’s iconic Harborplace has been sold to the Ashkenazy Acquisition Corporation. The New York real estate investment firm acquired the Inner Harbor complex from General Growth Properties. The sale price was not disclosed and representatives from both companies declined to comment.

Harborplace’s grand opening was held on July 2, 1980. It was designed by Benjamin C. Thompson and was built by the developer James W. Rouse and The Rouse Company. General Growth purchased the complex in 2004. It is composed of two two-story pavilions, the Pratt Street Pavilion and the Light Street Pavilion. The Gallery at Harborplace, a four-story glass-enclosed building located across Pratt Street from Harborplace, was not included in the sale. It is also owned by General Growth.

The land occupied by Harborplace is owned by the city which leases it to the owner of the mall. According to city records, Harborplace is 93 percent leased this year. Its tenant roster includes the Cheesecake Factory, Ripley’s Believe It or Not, Bubba Gump Shrimp, Johnny Rockets Group Inc., H&M Hennes & Mauritz AB, Pizzeria Uno and the McCormick & Co. Inc. retail store.

Ashkenazy Acquisition Corporation focuses on retail and office assets. It has acquired over 13 million square feet of retail, office and residential properties throughout the United States and Canada. Earlier this year, the company also purchased the Village of Cross Keys, an upscale shopping center in North Baltimore.

“When you look at Ashkenazy properties, such as Faneuil Hall Marketplace in Boston, Union Station in Washington, DC, and Rivercenter in San Antonio, you see a company that could be a great fit for Harborplace. This is a company with a track record of investing in and managing premier destinations, each with its own local character, in cities across America,” said Baltimore Mayor Stephanie Rawlings-Blake. She also added that she is ”absolutely committed to working closely with Ashkenazy to continue making progress and to secure Harborplace’s legacy as a source of great pride for the people of Baltimore for years to come.”

Photo credits: www.harborplace.com

Walmart Supercenter Opens in Randallstown, MD

By Adrian Maties, Associate Editor

Brixmor Property Group, the second largest owner of community and neighborhood shopping centers in the United States, opened a new Walmart Supercenter in Randallstown, MD, on Wednesday, October 17. At the ribbon-cutting ceremony, Walmart associate, Hugh Lowery performed the national anthem.

The 160,908 square foot Walmart Supercenter at Liberty Plaza is located on the northeast corner of Liberty Road and Brenbrook Drive. I-695 is only one mile away. Discussions with Walmart for the construction of this Supercenter started as early as 2004. As a result of the development, Marshalls, another Liberty Plaza tenant, has renewed its commitment and has signed a long-term lease extension.

Brixmor has invested $16 million in the project. The entire physical plant of the property has been upgraded and a new facade, lighting, landscaping, and signage have been added. Energy-saving elements, such as LED lights in signage, freezer cases and the parking lot, are also included. They are part of Walmart’s overall efforts to reduce the total amount of energy used in stores and other operations.

The new Walmart Supercenter replaces a long-vacant grocery store. It will be open 24 hours a day, seven days a week and will include full-line groceries, a drive-through pharmacy with two lanes, a vision center and a hair salon. It will also create about 350 jobs.

Timothy Bruce, executive vice president leasing and redevelopment for Brixmor Property Group said, “Brixmor is pleased to have Walmart as a part of our center, and a part of the community. This long-awaited store opening will energize the shopping center and serve as a focal point for everyday shopping needs in the area. We have been working with Walmart for many years on this project and are pleased to celebrate this day with them.”

Headquartered in New York City, Brixmor has been a leader in redevelopment over the last decade. The company currently manages a national portfolio of more than 620 properties. Its nationwide shopping center portfolio contains 27 Walmart-branded stores, totaling over 3.3 million square feet.

Photo credits: Brixmor.

St. John Starts Work on 270,000 Sq. Ft. BWI Technology Park II in Anne Arundel County

By Adrian Maties, Associate Editor

St. John Properties, Inc. has started work on BWI Technology Park II, a 44-acre mixed-use business community located near BWI Airport in Anne Arundel County. This is St. John’s seventh business community developed in Anne Arundel County. The initial R&D/flex building is the company’s 100th commercial office or retail project in this jurisdiction.

BWI Technology Park II is a 44-acre mixed-use business community designed to support approximately 270,000 square feet of office, flex and retail space. When finished, it will create almost 1,500 jobs. The 20,000 square feet of retail space will serve the community’s office tenants and surrounding residential neighborhoods.

The groundbreaking of the park’s first R&D/flex building comes after a nearly four-year reclamation project on the site. St. John Properties removed more than 45,000 spent and discarded car and truck tires as part of Maryland’s Scrap Tire Program. The clean-up program used to reclaim the 44-acre parcel was considered among the most extensive of any effort performed under the Maryland Department of the Environment’s Solid Waste Program.

809 Pinnacle Drive is the first building at BWI Technology Park II. It will be a single-story, 51,120 square foot R&D/flex building, constructed with a brick and glass exterior. The facility will feature 16-foot ceilings, suites beginning at 2,520 square feet and rear loading docks.

The building is also designed to achieve LEED certification. It will include high-energy HVAC units, energy-efficient motion sensor light fixtures, double pane insulated glass, white TPO roofing membrane, dual-flush toilets and waterless urinals and the use of low VOC paint and adhesives. A state-of-the-art system that minimizes the effect on local waterways will be used to manage storm water runoff.

809 Pinnacle Drive is expected to be completed in the first quarter 2013. St. John Properties will develop another six buildings within the business community. Among them, a 61,200 square foot Class A office building and three R&D/flex buildings totaling 145,000 square feet of space.

BWI Technology Park II complements the existing 600,000 square foot BWI Tech Park business community. The final portion of this three-project development is the planned BWI Tech Park III. Construction on this third and final business community is expected to start later this year.

Photo credits: St. John Properties.

St. John Properties Breaks Ground on New R&D/Flex Office Building in Maple Lawn

By Adrian Maties, Associate Editor

St. John Properties, Inc. started construction at the end of September on a 42,620 square foot single-story building in its Maple Lawn Corporate Center park in Maple Lawn, a 600-acre mixed-use business community located in Howard County. This is the company’s final R&D/flex office product constructed in the Maple Lawn Corporate Center.

11850 West Market Place will feature 16-foot ceilings with suite sizes beginning at 2,520 square feet and rear loading docks. The exterior of the building will be brick and glass. It is designed to achieve Leadership in Energy and Environmental Design (LEED) certification and will have high-energy HVAC units, energy-efficient motion sensor light fixtures, double pane insulated glass, white TPO roofing membrane, dual-flush toilets and waterless urinals and the use of low VOC paint and adhesives. Storm water runoff is managed by utilizing a state-of-the-art system that minimizes the effect on local waterways.

Maple Lawn is located in the Baltimore-Washington corridor section of Howard County, 22 miles from Baltimore and 28 miles from Washington, DC. It is a mixed-use community offering a “Main Street-style” environment, with office space, research and development/flex space, medical buildings, restaurants and retail, as well as a residential component that can support more than 1,300 units. Plans also call for a full-service hotel and conference center.

St. John is developing Maple Lawn in a joint venture partnership with Greenebaum Enterprises, Inc. that includes 388,000 square feet of existing office space, as well as the development rights for more than 800,000 square feet of office space. Last month, the Baltimore-based company also started work on 8135 Maple Lawn Boulevard, a four-story, 138,000 square foot Class “A” office building in Maple Lawn’s Business District.

“We continue to experience an extremely high demand for flexible office space among users looking for a strategic position within the Baltimore-Washington, D.C. corridor region,” stated Jerry Wit, senior vice president, marketing for St. John Properties. He added that the latest project “is perfectly suited for professional service companies, satellite offices or light manufacturing and production organizations seeking to tap into the momentum of this strong marketplace. The leasing pace for each of our Maple Lawn R&D/flex buildings has exceeded our expectations.”

Charts courtesy of Cassidy Turley.

Photo credits: St. John Properties.

Industrial Leases Pick Up in Baltimore

By Adrian Maties, Associate Editor

As we’ve previously reported, the Baltimore Metro Area industrial market is seeing a lot of activity lately. With the overall vacancy decreasing, some companies are buying and selling industrial assets while others are seeking to lease space at lower costs before the recovery pushes rents higher.

Transwestern announced on September 26 that, with a final 12,554-square-foot industrial lease, it has brought to full occupancy the 121,528-square-foot industrial warehouse building at 8730 Greenwood Place in Savage, MD. The deal was between Alpha International, Inc. and Atapco Properties, Inc., the owner of the property. Transwestern’s Brian Siegel represented the tenant while the team of Brian Watts, Tom Gentner and Mark Glagola, also of Transwestern, represented Atapco Properties.

8730 Greenwood Place is located on 6.7 acres. Transwestern negociated a 51,180-square-foot lease to E&G Classics, Inc., in August 2011. It was followed by a 25,576-square-foot lease in March, to Gramaco Granite and Marble, LLC. Transwestern has leased 75 percent of the building over the last 12 months.

Another deal went down in Glen Burnie. Mohawk industries has signed a five-year lease renewal for 82,901 square feet at 1910 Park 100 Drive. The building is located in the Park 100 Industrial Park. It comprises 187,200 square feet and still has 104,000 square feet available for lease. CBRE’s Toby Mink and William Pellington represented Mohawk while the building’s owner, Invesco, was represented by Merrill Turnbull and Paul Danko of the Lincoln Property Company.

Chesapeake Compost Works Benefit, LLC has also leased 54,000 square feet at 4501 Curtis Avenue in Baltimore. Toby Mink of BTR Curtis, LLC, represented the landlord while Chesapeake Compost Works was represented by Steven L. Cornblatt, principal at Trout Daniel.

The property is now home to a green industrial recycling facility that converts organic waste materials into compost, the largest of its kind in Maryland. Operations started on October 1. Chesapeake Compost Works plans to hire 10 new employees during the next year.

Charts courtesy of CBRE.

UMBC Opens First Phase of $165M Performing Arts and Humanities Building

By Adrian Maties, Associate Editor

The University of Maryland, Baltimore County (UMBC) held a day-long celebration on Wednesday, September 19, to mark the grand opening of the first phase of its new $165 million Performing Arts and Humanities Building as well as the ground breaking for the second phase. Governor Martin O’Malley was present at the ceremony. The day’s events included an arts and humanities festival, musical performances and an inaugural lecture at the building’s new theater.

Construction on the 170,000 square-foot building started in the summer of 2010. It’s located on 4.8 acres on the west side of Hilltop Road and will be a natural extension of the campus to the north. The Performing Arts and Humanities Building was designed to provide a new, state-of-the-art facility for the arts and humanities departments and programs, enhance teaching, research and public outreach, and heighten the visibility of the arts and humanities as major components of campus and community life.

The first phase of the project houses UMBC’s theater and English departments, its artist and humanities scholars programs, the James T. and Virginia M. Dresher Center for the Humanities, and the arts management offices. It includes a 275-seat theater as well as a 120-seat theater.

Phase two of the project is expected to open in fall 2014. It will provide space for the Departments of Ancient Studies, Dance, Music and Philosophy, and include a 350-seat concert hall and 120-seat dance studio.

The Performing Arts and Humanities Building will incorporate such environmental efficiency measures as rainwater harvesting, reduced light pollution, 40 percent reduced water consumption and daylight and views in 75 percent of the space. It is designed to achieve LEED Silver certification, and will be the first LEED certified building at UMBC. The project is being paid for through the state’s capital budget. Boston’s William Rawn Associates Inc. and Grimm + Parker Architects of Calverton are the architects.

Image courtesy of UMBC.

Belcamp’s Riverside Distribution Center Sells for $31.1M; Baltimore County Industrial Building Secures $12.5M Bridge Loan

By Adrian Maties, Associate Editor

Cassidy Turley recently announced the sale of a 599,109-square-foot industrial property in Belcamp, MD. Pennsylvania-based Exeter Property Group acquired the portfolio from Boston-based TA Associates for $31.1 million. The seller was represented by Jonathan Carpenter and James Wellschlager of Cassidy Turley’s Capital Markets Group.

The Riverside Distribution Center is comprised of two Class A distribution properties located at 121 and 151 Bata Boulevard. The facility at 121 Bata Boulevard was constructed in 1998 while the property at 151 Bata Boulevard was built in 2000. According to Cassidy Turley, the Riverside Distribution Center is 93.3 percent leased.

“These truly modern and functional Class A properties are equipped with many [key] features that serve the evolving distribution needs of today’s corporate tenants,” Jonathan Carpenter, said senior vice president and principal at Cassidy Turley. “As a testament to the quality of the real estate and the submarket location, we performed over 20 property tours and the offering appealed to a large pool of qualified regional, national and international investors,” he added.

In other news, a 689,000-square-foot industrial building located in the Baltimore suburb of Arbutus has secured a $12.5 million bridge loan from Hudson Realty Capital LLC, a New York City-based real estate fund manager.

The building is located on 34 acres in Baltimore County, south of Baltimore. Interstate 95 is just one mile away and easily accessible via the I-295 and I-695 interchanges. It features 26-foot to 32-foot clear heights, 50-foot column spacing, 26 cranes, including one 10-ton crane bay and 12 drive-through doors. The building also offers covered rail service and access to the Port of Baltimore. Its tenant roster includes a manufacturing company, mechanical contractor, logistics company and wholesaler of natural stone products.

“Like many owners of Class-B and Class-C assets in the nation’s middle markets, this sponsor needed a competitively priced, non-recourse bridge loan to stabilize the property for the longer term,” said Geoffrey Smith, one of Hudson’s managing directors. “Hudson is helping fill the lending void in primary and secondary markets for storied properties that are poised for a rebound and sustained growth.”

Image courtesy of Hearn Burkley.

IIT Buys Two Greater Baltimore Industrial Assets for $16.1M

By Adrian Maties, Associate Editor

Industrial Income Trust continues its buying spree in the Greater Baltimore area. The Denver-based real estate investment trust paid $16.1 million for two fully leased industrial properties. The transactions occurred simultaneously in the first week of August. TA Realty Associates was the seller. The company was represented by CBRE’s Bo Cashman, Jonathan Beard and John Boote.

The first property is 8801 Citation Road in Baltimore County. It is located within the 1.4 million square foot Pulaski Industrial Park, just 1.5 miles from the I-95/I-695 Interchange and 7 miles east of the Port of Baltimore. The property totals 156,797 square feet and features 30-foot clear heights, 17 loading docks and one drive-in. Industrial Income Trust paid $10.3 million.

The other property is the Emmorton Center located at 2109 Columbia Park Drive, in Edgewood, Harford County, MD. The single story industrial warehouse was completed in 1997 on 5.7 acres. It totals 107,300 square feet and features GI zoning, masonry construction, sprinklers, utilities, 80 free surface parking spaces, a 0.56/1,000 square foot parking ratio, 28 exterior docks and two drive-in bays, as well as 28-foot ceiling heights. Route 24, Route 40, Route 1, I-95, I-695 and I-83 are all conveniently located nearby. Industrial Income Trust paid $5.8 million for the property.

The Greater Baltimore Metropolitan industrial market experienced continued demand in the second quarter of 2012. A market report released by CBRE says the overall vacancy rate decreased in the second quarter of 2012, from 10.9% to 10.4%, as users are seeking to lease space at lower costs before the recovery pushes rents higher. As leasing activity improves in the region, investors are looking to purchase high quality industrial assets.

Industrial Income Trust has been very active this year in the Baltimore Metropolitan Area. The real estate investment trust paid $7.8 million in April for a 128,800-square foot industrial building located at 7453 Candlewood Road in Hanover, in the Baltimore Commons Industrial Park. A month later, in May, it purchased its second Hanover industrial asset, the 198,369-square-foot building at 7463 New Ridge Road, for which it paid $11.7 million. A 222,636-square-foot bulk warehouse at 7621 Energy Parkway in Curtis Bay was acquired for $15.2 million at the start of August.

Charts courtesy of CBRE.

Baltimore High-Rise Office Buildings Going Up For Auction

By Adrian Maties, Associate Editor

Two office buildings in Baltimore’s central business district are expected to be auctioned off in the following months. The two properties are the Calvert Center at 225 N. Calvert Street and the office building at 1 N. Charles Street.

The Calvert Center is a 17-story office building located between the Mercy Medical Center and the Battle Monument Park. The high-rise totals roughly 411,730 square feet and formerly housed Bank of America’s local operations center. A parking garage is located beneath the building and combines below-grade and above-grade parking with a total of 329 covered parking spaces.

Bank of America left in 2009, leaving behind 220,000 square feet of vacant office space. It was followed by M&T Bank. The Buffalo, N.Y., bank company vacated 30,500 square feet of space at 225 N. Calvert Street. Now, the high-rise sits mostly empty. Only seven percent of the building is currently occupied.

CBRE Auction Services announced the building will be sold at auction on Thursday, October 11, 2012. They have set a minimum bid of $14 per square foot. It represents a great opportunity for anyone looking to acquire an office building located next to a major medical campus, a new residential development and City Hall. The building could also be redeveloped.

The 25-story building at 1 N. Charles Street was constructed in 1962 and sits on a 0.36-acre parcel. It totals 291,000 square feet of office and first-floor retail space and is scheduled to be sold at a foreclosure auction on September 7, according to the Baltimore Business Journal.

Buccini/Pollin acquired the building in 2007 for almost $16 million. The company mentions on its website that building renovations of over $10 million are underway. They include a state-of-the-art security system and upgrades to the common areas.

MacKenzie Commercial Real Estate Services represents the Buccini/Pollin Group and says on its website that the building has 85,593 square feet available for lease. Office rent is listed between $14.50 and $16.50 per square foot. The building has Caribou Coffee, the second largest coffee and espresso retailer in the United States, as a tenant. The company occupies space on the ground level.

Charts courtesy of CBRE.

Photos courtesy of CBRE Marketplace and Buccini/Pollin.

Historic Sparrows Point Steel Mill Sold For $72M

By Adrian Maties, Associate Editor

On Wednesday, August 15, a federal bankruptcy judge in Wilmington, Delaware, approved the sale of  the historic Sparrows Point steel mill. The property was sold to liquidator Hilco Trading of Illinois and St. Louis-based Environmental Liability Transfer for about $72.5 million. Its owner, RG Steel LLC, filed for Chapter 11 bankruptcy protection in May. RG Steel also sold its steel mill in Warren, Ohio, to C.J. Betters Enterprises for $17 million.

Sparrows Point first started making steel in 1889. It was purchased by Bethlehem Steel, once America’s second-largest steel producer and largest shipbuilder and, by the mid-20th century, was the world’s largest steel mill. Sparrows Point was a vital part of the war effort in both World Wars and, at its height, it employed tens of thousands of workers and produced hundreds of ships. Steel for the Golden Gate Bridge was forged there.

Bethlehem Steel filed for bankruptcy protection in 2001. Since then, Sparrows Point has had four owners. OAO Severstal acquired it in 2008 for $810 million. The Russian steelmaker sold it just last year together with other plants to RG Steel for $1.2 billion. That’s why some steel analysts have commented that the current price is ridiculous. The mill sits on more than 2,400 acres of land, south of Interstate 695.

When RG Steel filed for bankruptcy, it was the fourth largest producer of flat-rolled steel in the United States. It will use the money raised from the auctions to repay its creditors. When RG Steel closed the steel mill, 2,000 workers were left without jobs. Sparrows Point was one of Baltimore County’s largest private employers until the layoffs.

At the meeting, on Wednesday, the parties resolved some issues regarding the site’s environmental problems. Hilco Trading LLC won the bidding for Sparrows Point offering $72 million for the Baltimore County steel mill at an auction held two weeks ago. But it agreed to pay $500,000 more for a study to see if steel-making toxins have migrated from the mill to the waters around it. Hilco also said it is interested in finding operators to restart work at the mill, giving at least a little hope to the 2,000 that recently lost their jobs.

Charts courtesy of CBRE.

Image courtesy of the United States Environmental Protection Agency.

Caesars, Rock Gaming Granted License to Build and Operate $300M Baltimore Casino

By Adrian Maties, Associate Editor

Caesars Entertainment Corporation has announced that CBAC Gaming, LLC, the investment group led by Caesars and Rock Gaming, has received a license from the State of Maryland Video Lottery Facility Location Commission to operate a video lottery terminal (VLT) facility in downtown Baltimore. CBAC Gaming plans to build Harrah’s Baltimore, a $310 million casino, the second largest in Maryland.

“We are pleased to have been awarded the license to operate a VLT facility in Baltimore, and look forward to building a unique entertainment experience that will attract customers from across the country,” said Gary Loveman, chairman, president and chief executive officer of Caesars Entertainment.

Harrah’s Baltimore will be located at the corner of Warner Street and Worchester Street, in South Baltimore, near the M&T Bank Stadium. It will stand two stories high and have 3,750 slot machines. With 110,000 square feet of gaming space, the casino will also include a 125-seat steakhouse, a 400-seat buffet, a 5,700 square foot Baltimore-themed sports bar and restaurant, 1,200 square feet of retail, seven food and beverage outlets and a 2,500 square foot food court, as well as a 4,000-car garage.

“The development of Harrah’s Baltimore is part of our plan to develop casinos in urban areas that integrate into and support the surrounding communities. If table games are approved by Maryland’s General Assembly in a special session next week, it will add to the customer experiences the property will provide,” Loveman added. Caesars also owns the popular World Series of Poker franchise.

According to Caesars, the casino will generate 1,225 jobs when up and operating. Over 1,000 construction jobs will also be created. The development is expected to bring in tens of millions of dollars in revenue for the city and state and also change the surrounding area. Caesars is still in the process of obtaining permits. They plan to begin construction in the second quarter of 2013 and open the casino in the second quarter of 2014.

Caesars and Rock Gaming successfully opened a Horseshoe Casino in Cleveland earlier this year. They are also building another Horseshoe Casino in Cincinnati. It is expected to open in spring 2013.

Rendering courtesy of Caesars Entertainment.

CBRE Global Investors Fund Buys Two Class A Apartment Communities in Towson

By Adrian Maties, Associate Editor

CBRE Global Investors recently announced it has purchased two mid-rise apartment communities in Towson, Maryland. The acquisition totals 430 units and was made on behalf of the CBRE Strategic Partners U.S  fund series.

The two class A properties are the Renaissance at the Quarter and Jazz at The Quarter. They are located at 900 and 960 Southerly Road, near the newly renovated Towson Town Center regional mall and the Towson University and Goucher College. Both properties have good access to the Baltimore Beltway (I-695), downtown Baltimore and suburban employment centers.

Renaissance at The Quarter features 150 units with large floor plans and condominium-quality finishes such as 42-inch maple cabinets, ceramic flooring and granite countertops. The community boasts its own movie theater and separate club lounge as well as several outdoor courtyards. Jazz at The Quarter has 280 units with one-, two- and three-bedroom floor plans. Amenities include a 24-hour fitness center, business center with free Wi-Fi access, and the community’s refreshing pool, complete with an outdoor grilling area.

The properties are among the newest apartment communities in the submarket. They are about 85 percent occupied. Other amenities include concierge services, on-site management, storage space, on-site maintenance, sundeck, elevators, controlled access and a pilates/yoga studio. Cats and dogs are allowed although there are some restrictions. CBRE plans to rebrand the Renaissance and the Jazz, and combine them to form a single community rebranded as The Quarters at Town Center.

“With our strength of ownership, capital infusion to enhance the marketability of these properties, and aggressive management, we believe we can reposition the asset into a premier community in the submarket,” Steve Gullo, senior director of CBRE Global Investors’ Multi-Housing Group, said in a press statement.

“Towson is a supply-constrained micro-market as only five properties including Renaissance and Jazz have been built since 2000, and limited deliveries are expected through 2015,” said Steve Zaleski, managing director of CBRE Global Investors’ Multi-Housing Group. “We see significant upside potential as the submarket experiences continued growth.”

CBRE Global Investors is an independently operated affiliate of CBRE Group, Inc. CBRE employs approximately 34,000 people in more than 300 offices worldwide.

Image of the Renaissance at The Quarter courtesy of www.liveatthequarter.org/.

Baltimore’s Aging Bus Yard will Get $53M Overhaul

By Adrian Maties, Associate Editor

U.S. Transportation Secretary Ray LaHood announced on July 23 that $787 million has been awarded by the federal Department of Transportation as part of its annual State of Good Repair and Bus Livability program to help repair and modernize the nation’s aging transit infrastructure. The money will fund 255 projects selected from 836 applications.

The city of Baltimore will receive $40 million to replace the old Kirk Division Bus Facility with a new two-building green complex. The grant received by the Maryland Department of Transportation is the second largest awarded by the Transportation Department. New Jersey Transit was awarded a $76 million grant.

The old Kirk Division Bus Facility on the 2300 block of Kirk Avenue in East Baltimore was constructed in 1947 and in its 65 years has never been renovated. It houses 351 employees and stores, and it operates and maintains 175 buses serving 16 routes in Baltimore and Baltimore County.

The Maryland Transit Administration will use the $40 million grant together with $13 million provided by the state for the first phase of the project. It involves the construction of a state-of-the-art, energy-efficient building to house maintenance operations for the Kirk Bus Division. The new 100,000-square-foot maintenance yard will be completely enclosed. It will be located on the site of the Reese Press building, directly across from the existing Kirk Division. On-site parking will also be provided to help bring down the number of cars parked on the street. Noise from the buses will be reduced and air quality will be improved. In the second phase, the present outdoor bus yard will be converted into inside bus storage and administrative offices.

The project will create 700 construction jobs. Construction will begin in late spring 2013. The state expects to have the new facility open in the fall of 2014.

The state of Maryland received five grants on July 23, totaling $45 million. In addition to the $40 million for the new bus depot, Baltimore was also awarded $1.65 million to to make safety and accessibility improvements to South Baltimore’s Cherry Hill Transit Hub, a hub that connects bus and light rail service. Other improvements also include an expanded bus waiting area, a park and ride lot, and a well-lit and upgraded station plaza.

Rendering courtesy of http://mta.maryland.gov.

MICA to Invest $18.5 Million in Student Housing Projects

By Adrian Maties, Associate Editor

The Maryland Institute College of Art (MICA) has announced it will break ground in late fall on a $16.5 million student housing expansion project. The addition will help MICA provide housing for more than half its undergraduates and will also lead the revitalization of Baltimore’s North Avenue corridor and northern Bolton Hill.

Known as the Commons II, the building will be an addition to the Commons and will be located at 120 McMechen St. in Bolton Hill. It will stand five stories high with 62 apartments. The Commons II will accommodate about 240 students, replacing a parking lot situated along North Avenue west of Mount Royal Avenue. Plans also include a multifunctional black box performance space, a tiered lecture hall and artist studios with a landscaped plaza and parking outside.

Baltimore’s Commission for Historical and Architectural Preservation approved the plans for the 88,000-square-foot Commons II in May. Hord Coplan Macht is the project’s architect. Commons II will serve as a connector between Bolton Hill and the Station North Arts & Entertainment District. On the side facing North Avenue, the building will feature a brick facade that will complement Bolton Hill’s historic rowhouses. The other side, facing the Commons, will have a more contemporary design.

MICA opened its first large residence for students 20 years ago. With the Commons II, the college will offer on-campus housing for more than 1,000 students. The facility is expected to open in 2013. It will seek certification from the Baltimore City Green Building Standards.

In addition to the expansion project, MICA is also planning a $2 million renovation of the Commons complex. This project will be completed by the end of 2013. It calls for a laundry center, cafe lounge, mailboxes and possibly an exhibition space to be added, as well as connections to Commons II. Ayers Saint Gross is the architect. The Whiting-Turner Contracting Company is the contractor for the Commons project with Lazarus Design Associates as the landscape designer. Both the construction and renovations will be financed by bonds.

Rendering courtesy of Hord Coplan Macht.

Developers Planning New Housing at Harbor Point

By Adrian Maties, Associate Editor

Baltimore’s Harbor Point is a mammoth waterfront project by John Paterakis Sr. and the developers now intend to make it even bigger. On Thursday, July 5, at a meeting of Baltimore’s Urban Design and Architecture Review Panel (UDARP), representatives of John Paterakis’ Harbor East Development Group presented a preliminary design that would amend the master plan, seeking for permission to build up to 1,000 residential units and a new hotel.

The Harbor Point project calls for the redevelopment of the former Allied Chemical site between Harbor East and Fells Point. The former plan allowed the construction of up to 1.8 million square feet for offices, retail space and hotel rooms. The new plan would bring an additional 1.1 million square feet of space for housing, increasing the project’s size by 60 percent and making it more of a mixed-use community than is currently allowed by the city’s zoning.

Under the revised plan, the total investment in the project would be about $1.5 billion, up from a previous estimate of $1 billion. The majority of the offices would be on the north and west sides of the 27-acre property while the residential units would be located on the southern and eastern sides. Included in the new plan are 9.3 acres of open space, waterfront promenades and other public amenities, a large parking garage and at least one new hotel. Ayers Saint Gross of Baltimore is the project’s architect.

The Harbor East Development Group is looking for funding assistance in the form of Tax Increment Financing to help pay for roads, garages and other public infrastructure. Originally, they requested the allocation of $154 million but the new plan lowers that amount to around $100 million.

The design panel asked the developer to revise the plan and return with another presentation. Harbor Point needs the City Council’s final approval in order to begin construction. It could be completed in 6 to 20 years.

Image courtesy of Ayers Saint Gross.